I think a lot of people have false ideas about what entrepreneurship is all about. Apparently, so does Carol Roth. In her book, The Entrepreneur Equation: Evaluating the Realities, Risks and Rewards of Having Your Own Business, she lays it all down for anyone considering starting a business. Roth covers all the reasons people want to start a business:
- It’ll make me rich
- I want to be my own boss
- I want to do more of what I love
- I can work when and where I want
Then she essentially shatters these myths. Think you’ll be your own boss? Think again. You have to answer to your employees, customers and vendors. Getting rich? Very few strike oil in their first year (or three). The book is designed to scare the bejesus out of you, and if you finish it without screaming off into the sunset, you just might be cut out to be an entrepreneur.
The Honeymoon Period
Roth covers what she calls the “honeymoon period.” This is when a new business does really well for the first year or so, but then begins to falter. Consider the new restaurant that just opened down the street. You and hundreds of others want to try it out. So the restaurant sees a lot of new business. But if it’s not that impressive, you probably won’t be back. After the newness wears off, the restaurant is shocked to see such a decrease in sales. The key is providing great value and service, and then marketing to keep customers coming back.
Are You Cut Out for It?
Throughout the book, you’ll be asking yourself, “Am I up for all this?” Roth helps you by providing questions and worksheet pages that ask thought provoking questions like:
- Is it the right time for you to fully engage in a new business opportunity?
- Do you have a personality whose character traits are consistent with business ownership?
- Does your opportunity have enough competitive advantages to compete effectively in the current uber-competitive business environment?
What I loved about this book is that it’s a dunk of cold water for anyone who’s got preconceived notions about what being an entrepreneur is all about. Roth doesn’t tiptoe around, and she doesn’t make false promises about running a business. There’s a good chance your business will fail. And you will have wasted time and money on it. So do yourself a favor and before launching into the unknown, read The Entrepreneur Equation to see if you’re up for the challenge.